Mitsubishi Corp.

S&P Global Ratings acknowledges a high degree of uncertainty about the evolution of the coronavirus pandemic. The consensus among health experts is that the pandemic may now be at, or near, its peak in some regions but will remain a threat until a vaccine or effective treatment is widely available, which may not occur until the second half of 2021. We are using this assumption in assessing the economic and credit implications associated with the pandemic (see our research here: www.spglobal.com/ratings). As the situation evolves, we will update our assumptions and estimates accordingly. The stable outlook reflects our view that the company's adjusted capital will recover in the coming two to three years to levels exceeding that of risk-based capital

...The rapid deterioration in business conditions caused by the COVID-19 pandemic will likely weigh heavily on Mitsubishi Corp.'s performance in the coming year or two. S&P Global Ratings expects a steep decline in demand to hit its automotive and industrial materials businesses. Also, weak commodity prices are likely to hurt its energy and mineral resources business. Net income is likely to fall to about Ñ200 billion in fiscal 2020 (ending March 31, 2021) from Ñ535.4 billion in the previous year. Its earnings face the risk of increased pressure if the effects of the pandemic drive commodity prices down further or if business conditions are unlikely to recover in 2021. Mitsubishi Corp.'s earnings are likely to recover after bottoming in fiscal 2020, underpinned by an extremely well-diversified and solid business portfolio. We expect continued steady profit contributions, mainly from nonresource businesses including food, infrastructure and power solutions, to drive the recovery. Also likely...

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